Understanding the Limits of Health Insurance

A tragic case of murder is being exploited by the media as propaganda pushing national medical insurance schemes. The ghoulish socialism-by-bathos strategy rests on the implicit unrealistic notion that we somehow can provide the best of everything for everyone.

An Associated Press story yesterday told a heart-wrenching tale of a "desperate" husband driven to murder his ailing wife "because he could not afford to pay for her medical care." The man's wife was 47 years old and suffering from uterine cancer and neurological problems. She weighed 75 pounds and was partially blind. According to the story, her husband kissed her goodbye, and then threw her off the balcony of their apartment building, to her death.

Significantly, the story does not condemn the man for his inhuman behavior. It does not question whether less-expensive alternatives were available for the wife's medical care (e.g., hospice care). Instead, the entire thrust of the story is that a lack of health insurance was the true culprit in this terrible situation. As the story noted, the wife "had no health insurance to pay for medical bills that ranged from $700 to $800 per week." According to the story, she only had $725 in monthly income (from oil royalties and social security disability), $6,700 in personal assets, and a parcel of property worth $20,000, which the husband planned to sell. Using the figures in the story as a guide, these assets could have paid for approximately one more year of the wife's medical care. So it is not at all clear that the husband's -- and the AP's -- explanation for why he murdered her makes sense. Of course, murder is such an extreme act that something more surely was going on here, probably inside the husband's deranged brain.

Nevertheless, it is obvious that this story reflects a larger agenda. The AP is using a human tragedy -- the wife's murder -- to argue, however subtly, in favor of a national health care system. I have no doubt that this story will find its way into the speeches of those advocating "universal" or "single payer" health insurance. After all, if such a system were in place, they will claim, this terrible tragedy would not have occurred. Right? Honestly, we can never know.

What we do know, however, is that "health insurance" is no panacea for high health care costs. At the end of the day (or fiscal year), someone has to pay for the medical care rendered to the insured and uninsured alike. If the wife in the AP story had health insurance, presumably her premiums and co-pays would have been less than the actual cost of her medical care (the $700 to $800 per week mentioned in the story). This is the only way her personal financial situation could have been improved by having had health insurance, as the AP suggests.

Yet the actual cost of providing medical care does not go down, as if by magic, just because someone has insurance. Advanced critical care or end-of-life care is extremely costly to provide. High-technology machinery, sophisticated pharmaceuticals, and well-trained doctors and nurses do not come cheap. So if the husband and wife in the AP story could not afford to pay for this type of care themselves (and it appears they could not), either they must go without it and/or find alternatives to it -- or someone else has to pay. This is true even if the wife had "health insurance."

Indeed, health insurance fundamentally is designed to shift the cost of providing health care from those who need it but can't afford it, to those who don't need it but can afford it. When people complain about a lack of national health insurance, in other words, what they really are saying is thatsomeone else should berequired to pay the cost of their medical care. Not only is this a radically irresponsible and immoral position in itself; but also, as a practical matter, few people, even in a society as rich as ours, have sufficient personal resources to pay out-of-pocket for the very best health care our medical industry has to offer in all contingencies. (Just as very few people can afford the nicest homes or fanciest cars or toniest prep schools.) So trying to shift the cost to other people through a scheme of national health insurance, ultimately, can't work. Whether individually or as a nation, we cannot consume more health care than we can afford.

So what about the ailing woman in the story? Unfortunately, sickness and dying are an inevitable part of the human condition. Even the most expensive medical care only postpones the arrival of the grim reaper. Nevertheless, as our society has become richer and more knowledgeable about combating the various illnesses that afflict us, the quality and quantity of health care available to the rich, the middle class, and the poor alike has improved immensely. We owe these advances, more than anything else, to the (mostly) free market system that survives in this country.

We need to keep moving along this path of improvement for all. National health insurance, i.e., socialized medicine, will derail this great train of progress, by eliminating incentives, stifling competition, elevating bureaucrats over doctors and patients, and imposing an ethic of shared mediocrity across the national landscape. All of us, but most especially people like the woman in the AP story, will be the worse off for it.

A tragic case of murder is being exploited by the media as propaganda pushing national medical insurance schemes. The ghoulish socialism-by-bathos strategy rests on the implicit unrealistic notion that we somehow can provide the best of everything for everyone.

An Associated Press story yesterday told a heart-wrenching tale of a "desperate" husband driven to murder his ailing wife "because he could not afford to pay for her medical care." The man's wife was 47 years old and suffering from uterine cancer and neurological problems. She weighed 75 pounds and was partially blind. According to the story, her husband kissed her goodbye, and then threw her off the balcony of their apartment building, to her death.

Significantly, the story does not condemn the man for his inhuman behavior. It does not question whether less-expensive alternatives were available for the wife's medical care (e.g., hospice care). Instead, the entire thrust of the story is that a lack of health insurance was the true culprit in this terrible situation. As the story noted, the wife "had no health insurance to pay for medical bills that ranged from $700 to $800 per week." According to the story, she only had $725 in monthly income (from oil royalties and social security disability), $6,700 in personal assets, and a parcel of property worth $20,000, which the husband planned to sell. Using the figures in the story as a guide, these assets could have paid for approximately one more year of the wife's medical care. So it is not at all clear that the husband's -- and the AP's -- explanation for why he murdered her makes sense. Of course, murder is such an extreme act that something more surely was going on here, probably inside the husband's deranged brain.

Nevertheless, it is obvious that this story reflects a larger agenda. The AP is using a human tragedy -- the wife's murder -- to argue, however subtly, in favor of a national health care system. I have no doubt that this story will find its way into the speeches of those advocating "universal" or "single payer" health insurance. After all, if such a system were in place, they will claim, this terrible tragedy would not have occurred. Right? Honestly, we can never know.

What we do know, however, is that "health insurance" is no panacea for high health care costs. At the end of the day (or fiscal year), someone has to pay for the medical care rendered to the insured and uninsured alike. If the wife in the AP story had health insurance, presumably her premiums and co-pays would have been less than the actual cost of her medical care (the $700 to $800 per week mentioned in the story). This is the only way her personal financial situation could have been improved by having had health insurance, as the AP suggests.

Yet the actual cost of providing medical care does not go down, as if by magic, just because someone has insurance. Advanced critical care or end-of-life care is extremely costly to provide. High-technology machinery, sophisticated pharmaceuticals, and well-trained doctors and nurses do not come cheap. So if the husband and wife in the AP story could not afford to pay for this type of care themselves (and it appears they could not), either they must go without it and/or find alternatives to it -- or someone else has to pay. This is true even if the wife had "health insurance."

Indeed, health insurance fundamentally is designed to shift the cost of providing health care from those who need it but can't afford it, to those who don't need it but can afford it. When people complain about a lack of national health insurance, in other words, what they really are saying is thatsomeone else should berequired to pay the cost of their medical care. Not only is this a radically irresponsible and immoral position in itself; but also, as a practical matter, few people, even in a society as rich as ours, have sufficient personal resources to pay out-of-pocket for the very best health care our medical industry has to offer in all contingencies. (Just as very few people can afford the nicest homes or fanciest cars or toniest prep schools.) So trying to shift the cost to other people through a scheme of national health insurance, ultimately, can't work. Whether individually or as a nation, we cannot consume more health care than we can afford.

So what about the ailing woman in the story? Unfortunately, sickness and dying are an inevitable part of the human condition. Even the most expensive medical care only postpones the arrival of the grim reaper. Nevertheless, as our society has become richer and more knowledgeable about combating the various illnesses that afflict us, the quality and quantity of health care available to the rich, the middle class, and the poor alike has improved immensely. We owe these advances, more than anything else, to the (mostly) free market system that survives in this country.

We need to keep moving along this path of improvement for all. National health insurance, i.e., socialized medicine, will derail this great train of progress, by eliminating incentives, stifling competition, elevating bureaucrats over doctors and patients, and imposing an ethic of shared mediocrity across the national landscape. All of us, but most especially people like the woman in the AP story, will be the worse off for it.